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26/03/2002
Construction insurance difficult but not in crisis
The Electrical Contractors' Association (ECA) claim that reports of a crisis in the insurance industry with underwriters refusing to cover companies working in perceived high risk sectors such as construction are exaggerated.
The ECA report that while there has been a hardening of the insurance market during the past year, this has not resulted in a hostile marketplace for construction companies.
Director of the ECA, David Pollock, said there has been undue scaremongering: "Contractors who manage health and safety properly and develop a good working relationship with their insurers rather than merely focusing on the bottom line premium should not have a problem obtaining cover.
"Since the collapse of Independent Insurance last June and the events of September 11, there has been a distinct hardening of the insurance market combined with an increase in premiums. However, this is due more to a correction of previous over capacity in the market rather than a crisis in the insurance industry. Premiums were already rising before the World Trade Centre tragedy."
The ECA point out that the insurance market, previously described as "soft", has seen an adjustment of what the ECA say were unrealistically low premiums.
Richard Forrest Smith, Business Development Manager of ECIC, the insurance subsidiary of the ECA, said: "The insurance market is difficult but certainly is not in a crisis. Contractors need to be prepared to pay for more realistic premiums following the under-pricing of recent years. As a specialist insurance company, ECIC is strongly committed to the construction industry sector and we will remain so, but we, like those who we obtain cover for, are working in a different market compared to that of the late 1990's."
The ECA represents the interests of over 2,000 member companies employing around 30,000 operatives involved in electrical installation work.
The association aims to provide a focus for the industry sector in terms of safety, training, qualification, technological development and industry performance.
(SP)
The ECA report that while there has been a hardening of the insurance market during the past year, this has not resulted in a hostile marketplace for construction companies.
Director of the ECA, David Pollock, said there has been undue scaremongering: "Contractors who manage health and safety properly and develop a good working relationship with their insurers rather than merely focusing on the bottom line premium should not have a problem obtaining cover.
"Since the collapse of Independent Insurance last June and the events of September 11, there has been a distinct hardening of the insurance market combined with an increase in premiums. However, this is due more to a correction of previous over capacity in the market rather than a crisis in the insurance industry. Premiums were already rising before the World Trade Centre tragedy."
The ECA point out that the insurance market, previously described as "soft", has seen an adjustment of what the ECA say were unrealistically low premiums.
Richard Forrest Smith, Business Development Manager of ECIC, the insurance subsidiary of the ECA, said: "The insurance market is difficult but certainly is not in a crisis. Contractors need to be prepared to pay for more realistic premiums following the under-pricing of recent years. As a specialist insurance company, ECIC is strongly committed to the construction industry sector and we will remain so, but we, like those who we obtain cover for, are working in a different market compared to that of the late 1990's."
The ECA represents the interests of over 2,000 member companies employing around 30,000 operatives involved in electrical installation work.
The association aims to provide a focus for the industry sector in terms of safety, training, qualification, technological development and industry performance.
(SP)
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